NRW signs Rio Tinto earthworks deal

Rio Tinto has named Perth-based mining contractor NRW Holdings as its preferred earthmover for the next five years for the expansion of its Pilbara iron ore operations to 333 million tonnes per year.

NRW said in a statement that it had entered an earthworks framework agreement with Rio, which covers two streams of earthworks, Port and Western Pilbara, consisting of project-specific contracts for Rio's 333Mtpa expansion program.

The first works under the agreement are collectively valued at $260 million and have been allocated to NRW's indigenous joint ventures; the NRW/Ngarluma and Yindjibarmdi Foundation JV and the NRW/Eastern Gurama JV.

The NRW/NYFL joint venture was awarded the $100 million Cape Lambert Port car dumper and bulk earthworks package in March, while the NRW/Eastern Gurama JV was awarded the Western Turner Brockman earthworks package in April, worth around $160 million.

Future work packages consist of similar bulk earthworks packages to the Cape Lambert port upgrade, and there are three further earthworks packages to be awarded under the Western Pilbara stream, NRW said.

The framework also places NRW in an early contractor involvement role with Rio, to identify cost and time efficiencies for earthworks packages.

"NRW and Rio Tinto have agreed to work together to deliver mutual benefit through the guaranteeing of available resources - both equipment, and workforce - in a timely manner by NRW; whilst ensuring Rio Tinto can adhere to its scheduling of projects to successfully carry out the 333 program," NRW's statement said.

At 10:04AM (WST) NRW shares had gained 3.5 per cent, to trade at $2.65.